Where Form 8865 Contractors 2023-2024

Hi, my name is Tom Troma and I work at Solar Point Solutions. Here at Solar Point, we specialize in the placement of mechanical, electrical, and manufacturing engineering professionals. I'm here to talk to you about a subject that comes up regularly from our contractors, and that is whether they should be classified as a W-2 employee or a 1099 contractor. This is a very important question and one that should not be overlooked. First of all, let's define what a 1099 really means. According to the IRS, a 1099 is a self-employed consultant or a business providing services for other businesses. The term "1099" refers to the IRS form that you receive at the end of the year, which shows your earnings for that given year. Now that we've defined what a 1099 is, let's discuss who really qualifies as a 1099. There are many factors to consider, but the IRS looks at three main criteria. The first one is behavioral, or who dictates your daily workflow. If your client determines your daily workflow, including the time you start the order, the task needed to be completed, and how to complete the task, that would typically disqualify you as a 1099. Another factor to consider in the behavioral category is whose equipment you use. If you use your client's computer and/or software, this would typically raise a red flag with the IRS. The second main criteria that the IRS looks at is financial. As a 1099, you should be paid per project, not per hour. Typically, a 1099 would submit a proposal, and at the end of the project, they would submit an invoice to the client and be paid accordingly. The final criteria to consider is the type of relationship. As a 1099, the relationship should be stated as a contractor and...